According to a recent analysis by CBRE, there is a growing demand for off-plan residential real estate in Abu Dhabi, while Dubai’s rental market appears to be experiencing a slowdown.
In the third quarter of the year, off-plan home sales in the UAE capital increased by a significant 101.6%, surpassing the growth rate of 46% in secondary market sales, as reported by the real estate consultant.
The overall volume of residential transactions in the emirate increased by 84.3% in the third quarter, primarily driven by the high demand for off-plan units. Off-plan transactions saw a remarkable surge of 135.5% in Q3 2023, in stark contrast to the modest 22.7% increase in secondary market deals during the same period the previous year.
Abu Dhabi has witnessed the launch of several residential projects, with many developers reporting sell-outs of their off-plan complexes.
Overall, the third quarter of the year showed robust demand in the UAE’s residential market, while Dubai’s market is displaying signs of deceleration.
In Dubai, the average residential rentals increased by 20.6% in the year ending September 2023, slightly less than the 21.7% increase observed in the previous month.
CBRE noted, “Although demand remains relatively elevated, we continue to see further moderation in the rental market. The rate of rental growth has softened throughout the year.”
CBRE expects this moderation trend in the rental market to persist, with many key residential areas experiencing a tapering off in growth. In these areas, a significant portion of listings is gradually lowering their asking rents.
In September, secondary market sales saw a rise of 30.5%, while off-plan unit sales declined by 41.5% compared to the previous month.
Despite the monthly decline, the overall volume of transactions recorded in the year-to-date through September 2023 reached 87,163, the highest figure recorded during this period. This can be attributed to the 19% increase in secondary market transactions and the remarkable 55.3% increase in off-plan deals, which supported the high volume of sales.
